Wednesday, April 29, 2009

This is my advice to you, when a lender or creditor calls asking for their money:

You Say : "Listen, Mr. Lender. I accept that I owe you money. It's true I have missed my monthly payments. There is no question I am behind. The truth is...I don't have any money to give you. Let me tell you why...I have lost my job or my spouse lost his/her job or I made bad investment decisions or my business failed or I am a poor money manager or I do not plan to make any more payments...So you see I will not be able to make any payments to you for at least 3 (6, 9) months. There is no reason to see my financial paperwork, since I told you that I will not be able to pay you for at least 3 months. Now that I explained my situation, will you stop calling me for at least 3 months?"

Lender Underpaid Rep Says : "We'll Sir, we can't stop calling. Your number came up through our computerized calling system. Our system has been programmed to call you 5 to 10 times a day. We are told that the more we harass you, we may be able to get something instead of nothing. We do appreciate your honesty. We will notate your account with your honest statement. OK. And there it is I just notated your account. While we understand you will not be able to pay us for at least 3 months, unfortunately we will call you tomorrow"

You Say : "What a minute. Let me get this right. I just told you that I cannot pay for several months, so what do you think I can say or do, if you call me tomorrow. You can't squeeze blood from a stone. If you know that I can't pay, won't your call amount to harassment."

Lender Underpaid Rep Says : "Sir, under applicable agreements and our internal directives, we have the right to call you any time. I understand where you are coming from, it just that...you know...we have to follow our polices."

You Say : "Then your policy is simple: 'Even if the Borrower does not have the money, we need to call them everyday anyway'. This does not make any sense. What additional info will you get tomorrow, if you know, RIGHT NOW, I can't pay for another several months. I mean...you are not calling me to talk about the weather."

Lender Underpaid Rep Says: "Sir, I understand. The truth is I am just a low paid laborer who acts like the front line infantry. We get hit first when the bullet's fly. Your right. It doesn't make sense, however our jobs become meaningless if we do not call you with our fake 'we care for you tone'. This is just another form of high pressure sales. We want to make sure you eat, sleep, sh..t, and talk about what you owes us. EVEN THOUGH YOU TOLD US YOU DO NOT HAVE THE MONEY."

You Say: "Well then. I appreciate your honesty. However, your honesty does nothing to help me, except to prove that 'phone call boarding' is your company's torture policy. At this point, I want you to NOTATE MY ACCOUNT with "If the calls continue, I intend to use any legal means necessary to stop the calls and to receive compensation for your harassment. So have a good day. Thanks for opening up. And...pick your head up. I know you got a job to do.

Thursday, April 23, 2009

Hello all. It is time to talk about certain money collection practices by the Lenders which are UNFAIR. And that's just being mild. While I respect the right for a bank to collect on a loan, if they have received money from taxpayer funded TARP or GARP or TALF or RALPH programs (b/c they have debt issues) then they better be show the same respect to you because of your debt issues.

Most of us know that a creditor can sue anyone of us, and if they win, get a money judgment. This judgment can be used to freeze your bank account while the creditor takes your money. A judgment can be used to garnish wages. It stays on your credit report for up to 20 years in certain states. The only way to get rid of a judgment is to win in court or settle with the creditor or pay the full amount with penalties.

HERE'S THE THING. I am know seeing Banks with second mortgages or HELOC'S (Home Equity Lines of Credit, sue a HOMEOWNER instead of STARTING A FORECLOSURE. That's RIGHT. If you have a mortgage a lender has the option of forcing the sale of the property OR suing the HOMEOWNER/BORROWER for the loan amount thereby getting a money judgment.

When we sign for a mortgage loan to buy or refinance a property, we sign a NOTE and a MORTGAGE. The NOTE allows the lender to get a personal money judgment against the borrower. The MORTGAGE allows the lender to force the sale of the property in order to get their money back.

Most times a LENDER will start a lawsuit based on the MORTGAGE so they can force the sale of a property. In the past the LENDER believed there was a better chance to get their money back from the sale of the property instead of trying to get a judgment against the borrower. When a bank sues a borrower it becomes an unsecured lien. Whereas, when a bank starts a foreclosure they have a secured lien.

The unsecured lien normally made a LENDER feel insecure. NOT ANYMORE it seems. Many lenders are discovering that doesn't pay to foreclose on a property that has no value and probably will never reach the values of before. For LENDER's taking a property in foreclosure is a money losing proposition. So a smart group of risk analysts said "It's better to sue for a personal money judgment against an individual. We will get more money from an individual then property. It's better than nothing. We can collect on their wages or any future assets because our judgment will last for 20 years. The big plus...no one will want a $300,000 judgment against them for not paying a mortgage loan or HELOC. THEY WILL BE OUR DEBT SLAVES FOREVER... FOREVER...FOREVER....FOREVER.....FOREVER.....FOREVER."

Yes, Bankruptcy can be an option.Normally a Bankruptcy can discharge unsecured debts. Meaning, once discharged, you never have to pay it. The Bankruptcy laws have changed, so depending on the particular situation, an unsecured debt may not get totally wiped out.

Most importantly, WATCH OUT. If banks are deciding that they can get more mortgage loan money by suing for a personal judgment instead of a foreclosure, then must know something, that most of us DON'T.

Most people do not want a $300,000 judgment against them personally because of an unpaid mortgage loan. In my opinion, while a lender has the right to do it, it is YOUR RESPONSIBILITY TO FIGHT BACK.

Do not sit back and let the bank do it. You must always defend yourself. I mean, let's think about it. You may have been making all these interest payments to the lender. Very little of your payments went to principle. NOW a lender wants a judgment against you for a mortgage that's worth more than the house. Or perhaps an adjustable loan that out of whack with your income. And to add insult to injury the lender is taking forever to give you a loan modification, while the lender gets your taxpayer TARP money, harasses you and your family with calls, letters, and visits, starts legal action. The loan may have flaws on top of that.

WE DON'T THINK SO.

The bottom line is Knowledge is Power. Be prepared to defend yourself against the onslaught of debt collection practices that's going to make your head spin, stress you out, and wrap you up.

This time, you will be prepared and ready to win the fight.

Remember You Have A Legal Obligation to a Lender Not a Moral Obligation.